With the holiday season fast approaching, we thought it would be appropriate to republish this article originally created by our sister HR company, Personnel Management Systems (PMSI). Like many things in HR, simple questions often require complex answers. If in doubt, ask an experienced HR person or your employment attorney.
HR Holiday Q and A
Q. My employer is open for business on every holiday, some of which I have to work. Isn’t this against the law?
A. Many businesses are open during the holidays. It is not against the law.
Q. As an employer do we have to provide paid holidays?
A. No, employers are not required to provide paid holidays. Many employers do, but it is considered a benefit.
Q. Can we require employees to work on holidays?
A. Yes, employers can require employees to work on a holiday.
Q. Do we owe non-exempt employees overtime if they work on a holiday?
A. Employers must pay non-exempt employees for all hours worked, but the pay does not have to be at an overtime rate – unless the hours are in excess of 40 in the workweek. (Note: some states treat overtime requirements differently.)
Q. If an employee works 40 hours in a week and then takes a paid holiday, do we owe him overtime? A. The law requires that employers pay for actual hours worked. Paid holidays are not considered actual hours worked, so they can be paid at straight time rates. Conceivably the employee could be paid for 48 hours of straight time. Some company policies may treat these holiday hours differently, but this would be considered an employee benefit.
Q. What if an employee is on FMLA, PTO, Sick, Vacation or Personal leave when a holiday occurs? Should she receive holiday pay?
A. There is no law that requires holiday pay while someone is on a leave of absence. Some company policies might address this issue differently.
Q. How do we handle holiday pay for non-exempt employees who work a compressed workweek – working four days a week, ten hours a day?
A. This would be set by company policy. For example, some employers would pay the employee only if the holiday occurred on a day that the employee would normally work.
Q. How much holiday pay should a part-time employee receive?
A. Holiday pay for part-time employees is not required (but if you do, paying the normally scheduled hours or a proration based on number of hours typically worked are options.)
Q. Can we require employees to complete an introductory period before becoming eligible for holiday pay?
A. Yes. A well written employee handbook would normally address issues like this.
Q. Are Christmas bonuses from the company taxable?
A. The IRS is more like Scrooge than Santa Claus. Yes, bonuses are considered compensation and taxed just like regular income. Sorry!
Q. If an employee “volunteers” to stay late to decorate the office or buy the office gifts on his own time, do I have to pay him for that time?
A. If the employee is a non-exempt employee, he must be paid for all hours worked, and yes, this would include time spent decorating the office and buying “office” gifts.
Q. We have mandatory religious activities such as prayer and singing “Silent Night” at the Christmas party. Is this ok?
A. Mixing religion and work can get complicated. Most HR people would advise using extreme caution particularly when an employer makes participation “mandatory.” Holiday lights, gift exchanges, parties, even wishing people “Merry Christmas” are all good. Forcing people to pray or sing a particular song is probably crossing a line that most HR people find troublesome.
Q. We have a Christmas tree and a Nativity scene in our office lobby. Isn’t this prohibited like it is in the public schools?
A. No, public schools are just that – “Public”. A private enterprise is not regulated by the rules regarding the separation of church and state.
Q. Is ok to hire school age kids during the holidays without a work permit because they are not in school and out on holiday?
A. No, if you hire minors, the employer needs a work permit.
This article was originally published in November 2014 on the PMSI website. For inquires about questions addressed in this article or human resources questions in general contact PMSI at (425) 576-1900. Payroll Specialties also has human resources professionals working out of our Eugene, OR office as well.